Demand stimulation in finished-goods inventory management: Empirical evidence from General Motors dealerships

Chuang, Chia-Hung; Zhao, Yabing

doi:10.1016/j.ijpe.2018.11.013

Cited by 21 publications

(15 citation statements)

References 47 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Considering the past researchers on slow-moving and non-moving inventory levels, it is evident that the major reason for the stockpile of inventory is accumulation on the basis of anticipation of demand (Matsebatlela and Mpofu, 2015;Escalona et al, 2019), seasonality of the product (Panda et al, 2008), low-demand pattern (Mobarakeh et al, 2017;Petropoulos et al, 2019), manufacturing-or quality-related issues (Fan and Zhou, 2018) and lack of monitoring on low turnover stocks (Chuang and Zhao, 2019). Holding the MNI and dead stock for a longer duration will definitely lead to a significant amount of cost to an organization in terms of loss of investment opportunities, the non-value-added cost in storing and managing the items and Invetory accumulation and its priotization increment in the management costs (He and Wang, 2019).…”

Section: Literature Reviewmentioning

confidence: 99%

“…In any manufacturing company, inventory can be categorized into three major types, i.e. raw material, work in process and finished good inventory, and each of these types requires appropriate inventory management techniques (Tsourveloudis et al , 2000; Rozhkov and Ivanov, 2018; Chuang and Zhao, 2019). Inventory management is an important aspect for any company in order to have an optimum inventory level, as excessive inventory can cost a company from about 20% to 40% of the total inventory value throughout the year, so it should be properly monitored and maintained at a minimal level (Ganeshan et al , 1999).…”

Section: Literature Reviewmentioning

confidence: 99%

“…As the stockpile of unnecessary inventory creates additional non-value-added costs, it should be minimized and organization should focus on having an optimum level of inventory in their warehouses (Tayyab and Sarkar, 2016). So, it is necessary for any organization to have an optimum inventory level in order to deal with uncertainty in the demand pattern (Nemtajela and Mbohwa, 2017; Chuang and Zhao, 2019), unreliability from the supplier's side (Jaarsveld and Dekker, 2011), a quantity discount and a lower ordering cost (Cardenas-Barron et al , 2020; He and Wang, 2019).…”

Section: Literature Reviewmentioning

confidence: 99%

See 2 more Smart Citations

Identifying the root causes for inventory accumulation and prioritizing them using an MCDM-based TOPSIS approach

Negi

Kharde

2021

MSCRA

View full text Add to dashboard Cite

PurposeInventory accumulation is a major problem for any organization, as it not only occupies the valuable storage space, but it also blocks the company's capital, leaving the owners with less cash to run the company's business. Aggregation of inventory in any organization contributes to inventory carrying cost; it affects labor productivity, increases equipment expenses and creates a loss of opportunity associated with it. Therefore, it is essential for any organization to come up with a solution to deal with the stockpile of inventory.Design/methodology/approachThis research aims to examine the potential causes of inventory aggregation in an organization. First, the potential factors for the build-up of inventory are identified from survey data collection, such as questionnaire approach and discussion with industry experts, and then weights are assigned to attributes to study the effects for these factors. After the identification of probable causes, they are analyzed through a multi-criterion decision-making (MCDM) approach and the technique for order of preference by similarity to ideal solution (TOPSIS) to prioritize the severity of these causes toward the accumulation of inventory and take corrective actions to prevent their disruptive effect on the business.FindingsThe top three causes identified from the TOPSIS analysis are sales and forecasting error, defects and quality related issues and communication gap between departments. Firstly, we focus on these major contributors and prioritize them using the TOPSIS analysis. Then, we proceed further toward other factors. The main reasons identified for the accumulation of inventory are (1) forecasting error, (2) bulk purchase, (3) data entry error, (4) communication gaps, (5) quality-related issues, (6) product category not traceable and (7) wrong material being procured.Research limitations/implicationsTo carry out the data analysis in this research paper, first survey data collection is done. Then, discussions with managers and executives in the particular domain are carried out, and weights are assigned to the attributes and the criteria to study the effects of the identified factors. After that root cause analysis (RCA) is performed to get to the genesis of the problem and to take necessary corrective action, for carrying out this study, a total of seven potential causes were identified and the contribution of these seven causes on five attributes or criteria, i.e. quantity (in tons), holding and carrying cost, effect on labor productivity, loss of opportunity cost and storage space were studied.Originality/valueThis research paper is the author’s original work, and all the analyses carried out are from the discussion with experts in the field and through the in-depth analysis carried out. This research aims to examine the potential causes of the accumulation of inventory in organizations and their contribution toward factors like inventory carrying cost, labor productivity, and opportunity loss and excessive storage space have been analyzed. This research provides great value to the readers in the respective domain.

show abstract

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

See 1 more Smart Citation

Identifying the root causes for inventory accumulation and prioritizing them using an MCDM-based TOPSIS approach

Negi

Kharde

2021

MSCRA

View full text Add to dashboard Cite

show abstract

“…Inventory has been an essential asset for a company and has been used as a bumper over uncertainty of market demands (Chuang & Zhao 2019, Nemtajela & Mbohwa 2017, unreliability of material supply (Van Jaarsveld & Dekker 2011), price protection (Gavirneni 2006), quality discount, and lower ordering cost (Cárdenas-Barrón et al 2018, He & Wang 2019. In contrast, since stocks contained non-value-added costs, it should be minimized (Tayyab & Sarkar 2016).…”

mentioning

confidence: 99%

“…Slow-moving and dead stocks contain quite high non-value-added costs, among which are warehouse cost, maintenance cost to preserve the quality of the stock, repair cost, and opportunity cost. This high non-value-added cost can be avoided using various approaches in forecasting demands more accurately (Chuang & Zhao 2019, Dolgui & Pashkevich 2006). In the meantime, to overcome slow-moving and dead stock, sales promotion can be intensified using the price reduction, premiums, bonus product, lotteries, and coupons, sample, and lump-sum sales or donation.…”

mentioning

confidence: 99%

Slow Moving and Dead Stock: Some Alternative Solutions

Sugiono¹,

Alimbudiono²

2020

Proceedings of the 17 Th International Symposium on Management (INSYMA 2020)

View full text Add to dashboard Cite

The change in the paradigm of inventory from valuable assets to worthless assets forces a company to vary its business process innovation. Companies that have not implemented a just-in-time system have to prepare process innovation that focused on minimizing inventory and avoiding deadstock (Pinçe & Dekker 2011, Van Jaarsveld & Dekker 2011.Previous studies showed that the main reason for slow-moving and dead stock is the low or rare demands for goods (Mobarakeh et al. 2017, Petropoulos et al. 2019, excessive stocks (Escalona et al. 2019, Matsebatlela & Mpofu 2015), seasonal product (Panda et al. 2008), design errors that make these goods unsold (Fan & Zhou 2018), and the lack of follow-up initiatives for stocks with low turnover (Chuang & Zhao 2019). Slow-moving and dead stocks certainly affect the newness or the obsolescence of the products and the huge carrying cost of stock (Fan & Zhou 2018, He & Wang 2019). Thus, slow-moving and dead stocks should be anticipated, and when they occur, these stocks should be wisely handled as not to impact the company's finance negatively. Manufacturing companies have three types of inventories, namely, raw materials, work in process and finished good inventory. Each type of inventories requires appropriate inventory management (

show abstract

Effect of Hybrid Multi-Verse with Whale Optimization Algorithm on Optimal Inventory Management in Block Chain Technology with Cloud

Govindasamy

Antonidoss

2021

Innovations in Computer Science and Engineering

View full text Add to dashboard Cite

Demand stimulation in finished-goods inventory management: Empirical evidence from General Motors dealerships

Cited by 21 publications

References 47 publications

Identifying the root causes for inventory accumulation and prioritizing them using an MCDM-based TOPSIS approach

Identifying the root causes for inventory accumulation and prioritizing them using an MCDM-based TOPSIS approach

Slow Moving and Dead Stock: Some Alternative Solutions

Effect of Hybrid Multi-Verse with Whale Optimization Algorithm on Optimal Inventory Management in Block Chain Technology with Cloud

Contact Info

Product

Resources

About